The Facts: Oil Company Profits

Major oil companies import crude and petroleum from a variety of sources, including some countries many Americans might prefer not to support. Trouble is, it's next to impossible to determine exactly which country provided the oil that produced the gasoline you're putting into to your car. You can guess -- for example, if you're filling up at a Citgo station, the odds are the gasoline has its origins in Venezuela or elsewhere in the Americas -- but can you be sure? No.

We'll look at more of the raw data on where our oil comes from in the next post, but first, let's take a quick look at what we do know about the oil companies that serve as the middlemen between foreign oil producers and American consumers:

ConocoPhillips and Amerada Hess Corp. will discuss their first-quarter earnings tomorrow morning. We'll see earnings reports from Exxon Mobil and Marathon Oil on Thursday, followed by Chevron on Friday. Exxon is expected to show a solid performance for the quarter, while Hess is likely to look weaker, in part because a plant outage has lowered its refining capacity.

For more information on oil company profits, the Associated Press story on Exxon's record profits last quarter is a must read, and the one from last month on Exxon's planned spending fills in some key details. See the charts along the left side of this USA Today story for expected earnings per share for the world's major oil companies.

NPR's Scott Horsley studied oil profits post-Katrina in a report you can listen to here. The Sierra Club provides a clearly-sourced fact sheet on profit increases and related information, like political contributions from (and tax breaks for) oil companies. For a different point of view, here's Conoco's presentation of the facts behind oil company profits.

Also of interest: The Department of Energy breaks down the costs that figure into the price for a gallon of gas -- and you can report the prices at your local gas station at the department's "gaswatch" page.

By Emily Messner |  April 25, 2006; 11:08 AM ET  | Category:  Facts
Previous: This Week's Debate: Foreign Oil Dependence | Next: The Facts: Origins of U.S. Oil Imports

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Typical W, go after the little guy for gas "torture" and let the big guys slide on by.

Posted by: Richard Katz | April 25, 2006 12:40 PM

Here in Washington state we get our gasoline from Alaska, and all the lies about "Katrina", "supply" and "ethenol" don't apply.

But our gas prices went up 50 cents in one week nonetheless.

Collusion?

Yes.

Just ask the Bush Family and Cheney - their pockets are full with the money stolen by the Bush Tax on the Middle Class at the gas pumps.

Posted by: Will in Seattle | April 25, 2006 01:46 PM

*Sigh*

Will_in_Seattle

Have you still not figured out that America is not the Center of the Universe? That Bush-Cheney-Hitlerburton sounds cool to a Lefty, but doesn't matter when you are discussing a global commodity where the US has under 10% of net production, 3% of proven reserves, and 23% of consumption???

The Rise of China and 2 billion others joining the modern world in other countries account for 58-62% of new demand in the world in the last 10 years. In the US immigration drives 90% of new oil demand as Pedro trades his burro for a used F-150.

And terrorism, uncertainty, and a pack of greedy speculators from NYC to London to Tel Aviv to Hong Kong add to price. And oil is - Globally Priced. That "your" oil comes from Alaska is irrelevant - factoring in minor shipping costs - Alaskan oil is worth as much as Saudi or Pemex oil now 70 a barrel, and will be worth 10 bucks if Saudi Oil drops that much.

God I wish America's schools weren't at the bottom of the advanced nations!! So they could teach these basic facts of life to kids.

Same with refineries - the reason that New England, which refuses to site a refinery up there doesn't pay triple what the Gulf States do where their refineries are is we have a national distribution system so they don't get screwed and can get away with their NIBY-ism. Conversely, when refiners do get tight, everyone is screwed. Except for Blue States that had liberals mandate "boutique blending" as part of a progressive environmentalist wishlist. They are getting screwed a little extra, as they so deserve!

How many refineries does Washington have, BTW? Any luck on the blocked oil & natural gas drilling off your coast, in the Cascades, and in the Federal lands to the East?

****************************

Emily - It's rich that the Sierra Club, which has led opposition to developing any new energy sources in the US while failing to oppose the unchecked immigration that drives most new American energy demand - blames the companies that make energy sources available and would go for making more sources available if they were not blocked by the likes of the Sierra Club.

Now the Sierra Club is rethinking "wind". Based on the massive bird and bat kills being reported from some windmill sites and angry members saying the "pristine views" in states like West Virginia, Colorado are being destroyed by windmills that are far worse, far more obstrusive than a small gas production spud or a microwave tower.

Looks like the eviroweenies may be rethinking their beloved windmills after actually having to live with them...

Posted by: Chris Ford | April 25, 2006 04:40 PM

The credibility of the Bush administration is zero. This President is a corporate
patsy; the corporations, including oil, know it. They are going to work it to the hilt. Our only hope is to get a Democratically controlled Congress come
November. If not, then my only suggestion is start going to church and praying hard.

This President is the most dangerous one we
have had since the beginning of American History. He is a psychopathic paranoid
psychotic. Yes he will start another war
before his term is completed. His mind is
the closest parallel to Adolph Hitler that
we will ever know.

Posted by: Robert of Eugene, OR | April 25, 2006 05:25 PM

Chris Ford, I invest globally. heck, I own BP and have in the past owned Exxon-Mobil, Royal Dutch Shell (ADR shares), and Texaco.

Don't try to teach me how to suck eggs.

Now, today I just sold 400 shares of Green Mountain Power, which is up quite a bit (not counting wonderful dividends). I'll probably put a bit more into GE - and I know where they do business.

Look, neocon Bushie attitudes in the GOP are just plain Bad for Business and Bad for America. Lies about "cutting pollution restrictions" being of any help, when most of the "problem" is that firms want a restricted environment to jack up the profit potential just don't fly, when any of us can buy the Wall Street Journal anywhere in America, and figure out we're being lied to by the deadenders in the White House.

Posted by: Will in Seattle | April 25, 2006 06:59 PM

Chris Ford:

As usual, your argument is undefeatable, as long as the reader accepts your flawed premise.

We're not talking about the price of oil. We're talking about excess profits and price gouging. Stick to the subject.

not "Bush-Cheney-Hitlerburton"? How about Cheney and the oil execs in a secret White House meeting prior to, but with the full intention of, going to Iraq?

You don't have a problem with this? You belive that all was on the up and up?

Now the target is on Iran? Why not N. Korea?

Hide your head in the sand - the answer is oil profits.

Yes they're working to benefit big oil. Yes, the Cabal is channeling money to Halliburton, KBR, et. al. Mark my words the coming investigations will prove it. (this is going to make Whitewater look like the witch hunt that it was.)

Here's a fact of life, kid:

Years ago, a friend of mine was convicted of embezzlement. after the conviction, she was still my friend, but she was also still an embezzler. I make no apologies for her, and I hide no secrets (neither of her crime or of my friendship with a criminal). I would not hire her for any position involving money or bank accounts. Hopefully, she'll never get another chance to get into trouble.

The point being that it's okay that you still support your choice of these criminals to run our government (and to bring dignity back to the office of POTUS). You may follow them loyally down the rat hole, for all I care. However, please stop playing the apologist. Ignoring the 700 lb., gorilla in the livingroom does not make the gorilla disappear.

Oil company profits are a clear example of price gouging. the cost of oil is one thing - the price at the pump and the obscene profits taken by these upstanding businessmen and patriots is another. How much profit do the Chinese oil companies make?(I assume that they pay the market price for a barrel of oil).

Recognize the difference.

___________________________________

Just visited the Sierra Club site - I had never been there before (even though I'm so far left it'll make you puke). They take no official stand on immigration, but they do call for reduction of population in the U.S and worldwide.

in addition, they call for the following:

• The Sierra Club will continue to address the root causes of migration by encouraging sustainability, economic security, human rights, viable ecosystems, and environmentally responsible consumption.

• The Sierra Club recognizes the need to reduce U.S. birthrates and adopt lower limits on migration to the United States to address our nation's rapid population growth and its harmful effects on the domestic and global environment.

• The Club remains committed to environmental rights and protections for all within our borders, without discrimination based on immigration status.

Pretty straight-up and seemingly honorable, too. I'm sure you'll find some evil in there somewhere.

And, on a related note:

You do understand the benefit of birds and bats, don't you?

Posted by: Smafdy | April 25, 2006 09:38 PM

You look like you're off to a great start. I knew there were other real thinkers out there! Wow!

Remember what Mulder used to say on "X Files"? - The truth is out there. It's true speculation has driven up the price and that short-term issues in the industry have affected supply quantities. But the gleeful doubling of price at the pump (and that includes fuel oil, natural gas - apparently, and diesel) has accrued only to the refiner/distributors. Cost of production and transportation has not altered radically. Something stinks in this business and the smell seems to be issuing from oil company profit reports.

Posted by: Jazzman | April 26, 2006 12:09 AM

Smarfy -

"We're not talking about the price of oil. We're talking about excess profits and price gouging."

If you were a little less dense, you would be able to comprehend my 4:40PM post that talked about oil is a global commodity and the price drives the profits of those that own the existing reserves. Or the losses. There is little discussion about the years of heavy "excess losses" various oil companies were hit with in the early 80s and in the mid-90s. And about how enviroweenies screwed this country but good by not permitting a refinery or a nuke plant for that matter, from not going off the drawing board the last 30 years. The "gouging" that exists is mainly market speculators making or losing billions on oil futures contracts. The Congress was presented the last investigation on "price-gouging" and "run-ups" following Katrina, which found no such activities by Big Oil or refinery operators. The price was driven by supply shortages and market speculators.

Smarfy: "Hide your head in the sand - the answer is oil profits."

Those that own the oil get the booty. Some by Big Oil, but the real winners are nations that have lots of it. It only costs KSA around 2 bucks to get a barrel out of the ground...so it sounds so unfair that the citizens of a foreign country make so much!! Whaaaaah! But if you had a gold mine and the price of your ore reserves doubled on huge demand by newly wealthy INdians and Chinese, I doubt you'd be begging to give it to the government so they could pay 1,000 bureaucrats to study "gold alternatives" and investigate if any new gold mines should be permitted 10 years out...Since you can't control much of anything in the world decides on oil, the Lefty solution is to just live forever in the 70s and blame "Big Oil" for a problem the Left was instrumental in creating.

Smarfy - "the cost of oil is one thing - the price at the pump and the obscene profits taken by these upstanding businessmen and patriots is another."

You are in a 1973 timewarp. It's incredible when you read a book on the 60s and 70s counterculture and see people today on Blogs rote-producing the same brainless rhetoric word for word. You likely don't even know which businessmen and women make what profit.

Oil in the ground value + oil contract price + Wholesale output + Transporters cost + Refining cost + Wholesale distributors cost + Retailers cost. Exactly who is "price gouging"?

Samrfy - " How much profit do the Chinese oil companies make?(I assume that they pay the market price for a barrel of oil). Recognize the difference."

There is no difference between BP, COSCO (a Chinese oil company), Citgo, Lukos, Pemex, Exxon, Aramco(KSA) - all are making profits with oil at 70 a barrel. At 10 a barrel, only Aramco was making money. At around 30 a barrel, Exxon and other US firms start to go in the black. The only difference is the governments that get the royalty on the oil based on worth sometimes elect to subsidize the oil price for their citizen consumers at below global market rates (Venezuela, Iraq).

Smarfy thinks Sierra is neutral on unchecked immigration, not recognizing that huge fights and resignations have centered around one line he himself quotes:

"The Club remains committed to environmental rights and protections for all within our borders, without discrimination based on immigration status."

In short, no difference in anything between the job claiming ability or legal status of citizens or illegals inside US Borders.

Smarfy - " And, on a related note: You do understand the benefit of birds and bats, don't you?"

Yes, and on that basis, I oppose mass use of windmill farms as environmentally destructive based on the huge death toll they are taking on birds and bats. Just as I oppose mass immigration that could drive US population to 1 billion people by year 2100 on the grounds of habitant destruction and loss of environmental sustainability in many sections of the country...on top of loss of resources like arable cropland, water... and ability of American infastructure to be able to conserve energy resources while still maintaining a decent quality of life for Americans.

********************

Jazzman - Liberals will do anything rather than face the fact that their own mindless opposition to developing any new sources of traditional energy supply while fixating on dreamy hippie "alternate power" fantasy stuff + The Rise of China and others - has led to a severe tightening in oil and natural gas supply, exacerbated by us refusing to build excess refining capacity or LNG terminals for gas reserves overseas that ARE just waiting on countries to build the LNG terminals to receive it. (China has 12 LNG terminals planned and they will probably be in service while millionaire lawyers in the USA are still filing motions to block LNG on behalf of scared enviroweenies here).

In past investigations, the only price-gouging has been found at the retail gas level and by speculators (re: Banks, Hedge Funds for Fat Cats, OPEC deciding to jack floor price up, Russia throttling Europe for a better nat gas price, Soros-type financiers) manipulating markets or pushing fears...Not "evil America", not "evil American Oil Companies)...that is so much the old 1970s Lefty cant.

Posted by: Chris Ford | April 26, 2006 02:02 AM

Everyone but big oil is responsible for the high price of gas!

Righty in charge, the world goes to hell. But it's all the 70 lefty's fault.

Windmills are destructive to birds and bats. But offshore drilling is safe to fish and fowls. What an environmentalist!


Specious!

Posted by: Chrisoroid Fordoloid | April 26, 2006 08:05 AM

CF:

Oh the poor oil companies. They stayed in the market when it was unprofitable (yeah, right), and now they're offsetting their losses? Give me a break. They are engaging in price gouging, or their profits would remain at a constant or near-constant rate of return.

Yes it's a commodity. Yes it's limited. Is it scarce? No more than a year ago.

On the Seirra Club, you miss my point. I too, am against illegal immigration. I like a higher standard of living for everyone in the U.S., such as we had as the direct result of the successful Democrat programs that built the foundation of our great society during the middle of the 20th century - the programs that make your life what it is (why do you hate it so?). The point is, why pick on the Sierra Club?

You wrote: "In short, no difference in anything between the job claiming ability or legal status of citizens or illegals inside US Borders."

That's not what it says. If you have a problem with illegal immigration (I do), why do you blame an environmental protection organization? Call your republican government - who, by the way, serves its constituancy by allowing this unfettered lawbreaking to continue. The SC is put forth as a right wing straw man. That crap doesn't work anymore (another false/flawed premise from CF and the jingoes).

A good line from the '60s and 70's: "We won't get fooled again".

But, we failed to educate our snotty nosed 20 somethings, and we did get fooled again. Pity.

Please don't reframe or restate my argument to suit your rebuttal. When it comes to getting rich, everyone in the chain of supply/production is getting rich. I can't begrudge the owner of the raw resource - especially if they're a foreign nation (Venezuela and Iraq are widely known as two of the wealthiest nations on earth - no?).

I do know that the oil companies are jacking the price while they can (a very unstable geopolitical situation makes for a good smokescreen).

You wrote: "Oil in the ground value + oil contract price + Wholesale output + Transporters cost + Refining cost + Wholesale distributors cost + Retailers cost. Exactly who is "price gouging"?"

While it's more like this: Oil in the ground value (they've got us by the short and skinnies, here)+ oil contract price (volitile, ain't it?)+ Wholesale output (controllable, if not stable) + Transporters cost (probably no great profit-taking here)+ Refining cost (should be stable w/minor fluctuations, a reasonable profit may be expected in the absence of a price gouging response to instability)+ Wholesale distributors cost (who add insult to the injury incurred at step 1, by jacking the hell out of the price to the Retailer, in order to maximize personal gain at the expense of everything else)+ Retailers cost. Exactly who is "price gouging"?

By the way, if I were less dense, I'd be much larger, but I'd weigh the same as I do now. That would be inconvenient. None of my clothes would fit properly.

Posted by: Smafdy | April 26, 2006 08:23 AM

Chris wrote:
"(China has 12 LNG terminals planned and they will probably be in service while millionaire lawyers in the USA are still filing motions to block LNG on behalf of scared enviroweenies here)."

And China's judgement is to be taken as sound? Have you seen the air in Shanghai? Have you seen what they did to the countryside and people to build the Three Gorges dam? I am surprised that anyone, especially you, would consider China to be a country we should be taking our cues from.

I remember in the 80s a proposal to build LNG terminals in NYC. A LNG tanker, if it exploded, would level NYC. You can guess which target OBL would have chosen if NYC had a LNG tanker tied up there on 9/11.

Posted by: Sully | April 26, 2006 09:08 AM

Chris Ford is an oil industry tool.
The truth is that alternative energy sources are the future, and oil is the past.
Effective alternatives to oil exist right now, but the current administration owes too much to the oil companies to enact any meaningful changes to its oil-centric policy.

I'm afraid that we need to have a serious crisis in this country before we rethink our energy policy, and then it will be too late. I envision $100-150 barrel crude prices becoming a reality in the near future. If gas prices rise to $4.00 per gallon, profits for already strapped independent truckers will be non-existent, and goods will simply not be delivered. When goods aren't delivered business ceases and we see economic collapse. There is no safety net in place to prevent this.
Will we wait until the collapse comes before we make any meaningful changes to our energy use and production?

Posted by: Chris M | April 26, 2006 09:16 AM

Chris M:
Right now the Saudis are not pumping the oil they could. Other countries are also not at 100% capacity. Speculators are driving up prices due to Bush and Ahmadinejad trading school boy insults. Much of the rise in oil is not due to the amount in the ground nor the ability to pump it out or ship it but due to pure speculation. I expect the price to only go a little higher at worst and probably drop back to the $50s if the Iranians get rid of Ahmadinejad and/or we impeach Bush.

China's demand is a concern but only in terms of pumping more out of the ground for now. The real problem comes in about 30 years when some countries cannot maintain the amount of oil they pump due to wells going dry. We need to target 2030 as the date this country is energy independent with reasonable milestones at 5-year intervals. If we do not, there will certainly be consumer wars over the control of oil starting in the 2020s.

Posted by: | April 26, 2006 10:33 AM

There are actually two oil industries out there: The international, vertically integrated majors, like Exxon, and the independents ranging from mom and pop operating companies in the Southwest, to much larger drilling and operating companies. Concentration in the oil industry has facilitated price increases. The number of majors shrunk in the 90s because of the Clinton administration's permissive merger policy. Low oil prices ($8 or $9 a barrell) drove smaller companies out in the 90s. The majors can actually benefit from cyclical low oil prices because their refining operations benefit from the low oil prices paid to independent producers, and the production side can buy up good producing properties, without risking exploration costs, much more cheaply. Majors also have a unique relationship with the foreign national oil companies that actually hold title to production in virtually all of OPEC plus non-member cooperating countries (e.g., PEMEX in Mexico).

The small operators are actually responsible for most of the new drilling in the continental US. Dealing with small "plays" is not financially efficient for the huge majors. Independents drill "wildcats" and development wells, and then try to sell the new finds to bigger operating companies. Operating companies manage production, well maintenance, and collection, which in mid-America is affected by the cost of refined diesel because most production from small operators is collected by truck rather than pipeline.

The independent petroleum producers association actually filed a Section 232 action with the Dept. of Commerce in the mid-90s alleging that cheap imported oil was hurting small independent producers. Commerce agreed, but issued no remedial action. Over 800,000 marginally productive wells, accounting for over a million and a half barrels per day were shut down and capped rather than being frac'd and reworked to increase production because of the low prices.

New recovery technology can prolong production, or even bring old fields back to life. Recovery techniques throughout most of the 20th century typically produced only about a third of the crude oil in the formation. Of course, the cost of production is much higher in the US than it is in the Middle East and Central Asia, but at $60 oil we should have seen a lot more new wells and reworked wells in the US.

We have not seen a major domestic production response to high prices, in part because a lot of the folks who in the past could have been counted upon to put together small drilling programs have gone on to other industries, and because the venture capital for independent drilling operations largely dried out after the stock market bubble burst.

There is a case for incentives for domestic drilling, including a tariff on oil imported from OPEC. The talk about windfall profits taxes, which historically have hurt small operators far worse than the majors who can be creative with transfer pricing, is sucking capital out of the remaining market for new domestic drilling by independents.

In order to increase domestic production, any policy should be crafted to take into account the existence of two different industries, and their very different micro-economic realities.

Posted by: Mike Deal | April 26, 2006 10:56 AM

There are actually two oil industries out there: The international, vertically integrated majors, like Exxon, and the independents ranging from mom and pop operating companies in the Southwest, to much larger drilling and operating companies. Concentration in the oil industry has facilitated price increases. The number of majors shrunk in the 90s because of the Clinton administration's permissive merger policy. Low oil prices ($8 or $9 a barrell) drove smaller companies out in the 90s. The majors can actually benefit from cyclical low oil prices because their refining operations benefit from the low oil prices paid to independent producers, and the production side can buy up good producing properties, without risking exploration costs, much more cheaply. Majors also have a unique relationship with the foreign national oil companies that actually hold title to production in virtually all of OPEC plus non-member cooperating countries (e.g., PEMEX in Mexico).

The small operators are actually responsible for most of the new drilling in the continental US. Dealing with small "plays" is not financially efficient for the huge majors. Independents drill "wildcats" and development wells, and then try to sell the new finds to bigger operating companies. Operating companies manage production, well maintenance, and collection, which in mid-America is affected by the cost of refined diesel because most production from small operators is collected by truck rather than pipeline.

The independent petroleum producers association actually filed a Section 232 action with the Dept. of Commerce in the mid-90s alleging that cheap imported oil was hurting small independent producers. Commerce agreed, but issued no remedial action. Over 800,000 marginally productive wells, accounting for over a million and a half barrels per day were shut down and capped rather than being frac'd and reworked to increase production because of the low prices.

New recovery technology can prolong production, or even bring old fields back to life. Recovery techniques throughout most of the 20th century typically produced only about a third of the crude oil in the formation. Of course, the cost of production is much higher in the US than it is in the Middle East and Central Asia, but at $60 oil we should have seen a lot more new wells and reworked wells in the US.

We have not seen a major domestic production response to high prices, in part because a lot of the folks who in the past could have been counted upon to put together small drilling programs have gone on to other industries, and because the venture capital for independent drilling operations largely dried out after the stock market bubble burst.

There is a case for incentives for domestic drilling, including a tariff on oil imported from OPEC. The talk about windfall profits taxes, which historically have hurt small operators far worse than the majors who can be creative with transfer pricing, is sucking capital out of the remaining market for new domestic drilling by independents.

In order to increase domestic production, any policy should be crafted to take into account the existence of two different industries, and their very different micro-economic realities.

Posted by: Mike Deal | April 26, 2006 10:57 AM

I may reluctantly accept the rising price of gasoline, fuel oil, etc but when I read that a Dinosaur paper pusher Oil executive can get a $400m retirement package as a result, I know I'm being conned and that is not the fault of SUV owners.

Posted by: camus | April 26, 2006 12:59 PM

A segment of mindless consumers will never take heed of prices this side of true absurdity; their behaviors will not be readily modified. Also, actual incentive rewards need to go those who conserve, not producers and distributors who have the markets cornered.

Ration each licensed driver a gallon a day (no exceptions for government employees), with any consumption over that requires the really big gas users to buy ration tickets not used by more austere others.

Clearly, the free market system with petroleum operators and products is not working to society's long-term interests in the United States. Therefore, go to a controlled market system.

Posted by: On the plantation | April 26, 2006 01:04 PM

Ration tickets!?! Now this is getting silly. I'm not happy about the price of gas but rationing when there is no shortage makes no sense.

What we really need is something that you can put in your tank that will work like gas. Ethanol is it. It will take years/decades to get to where you can go to a gas station or an ethanol station, and let the two commodities compete with each other. But ethanol's price will fluctuate on the open market (depending on harvest, fementation output, refining and delivery), just like oil. The only difference is it will all be happening within the US and that is a strategic advantage for America's security.

There are two problems that oil can cause:
1) High prices lead to economic recessions and higher inflation.
2) Scarce oil resources (which we do not have yet) lead to competition with other countries risking war over oil.

Today's high prices are not caused by shortages. They are caused by speculation. It can lead to problem #1. In about 20 years we will have real shortages which can lead to problem #2. We must develop internal fuel resources (ethanol) in those 20 years or we will face both problem #1 and #2. There is no technical problem in developing ethanol. The issues are political and economic, something past governments have been good at handling. I have no faith that this government will do anything to advance an ethanol industry. It is just too incompetent.

Posted by: Sully | April 26, 2006 01:39 PM

Thank you for the facts,I have come up with the perfect solution for the crises that is currently facing the nation, i.e., the high cost of oil, oil-based products and gasoline.

If we could simply get the following entities in America to stop the greed and price-gouging, we could afford our high energy costs. For example:

If we could get the Federal, State & Local Governments to stop,
If we could get corporate executives and our bosses to stop,
If we could get home-developers and home-builders to stop,
If we could get landlords to stop,
If we could get the Homeowners Associations to stop,

If we could get the medical industry, health professionals and other service providers to stop,
If we could get pharmaceutical companies to stop,
If we could get insurance carriers to stop,
If we could get my the dental service providers to stop,
If we could get utility companies to stop,

If we could get the mechanics and dealerships to stop,
If we could get the taxicab and toll-roads to stop,
If we could get the church and ministers to stop,
If we could get educational institutions to stop,
If we could get all the individual trades to stop,

If we could get the restaurateurs to stop,
If we could get the sports franchises to stop,
If we could get manufacturers to stop,
If we could plumbers and repairmen to stop,
If we could get the downtown and uptown parking garages to stop,

If we could get beauticians and barbers to stop,
If we could get hotels and all of the travel industry to stop,
If we could get the butcher to stop,
If we could get the wedding chapels to stop,
If we could get the guy who rents out the hall for wedding receptions to stop

If we could get the Morticians to stop,
If we could get athletes and entertainers to stop,
If we could get the cable guy (pun intended) and the satellite TV guy to stop,
If we could get banks and other credit organizations to stop,
And if we could just get you to stop...(whatever your trade or business may be),

Then we all could have enough money left over to pay the exorbitant prices that are being set by greedy oil barons and energy suppliers like gas stations, and there might still be enough left over after to go to Disneyland. Oops, they need to stop it too, been there lately?

Get it, almost every entity and person in America is overcharging! Greed is not unique to the oil industry, and I apologize if I left you or your organization off of my quickly constructed list; nevertheless, stop it and we will all have more money in our pockets!

Peace & Grace,

Posted by: Rev. C. Solomon | April 26, 2006 02:07 PM

Sorry Reverend, I'm not buying your solution.

Posted by: Sully | April 26, 2006 02:13 PM

Sully wrote:
"Today's high prices are not caused by shortages."
____________

Think of rationing as a consumption cap on this one source of energy, and one that does not knock out the little guy. With a cap future shortages are delayed. With a cap alternative sources are brought to life.

Nothing silly about it.

Posted by: On the plantation | April 26, 2006 02:46 PM

Sully - "And China's judgement is to be taken as sound? Have you seen the air in Shanghai? Have you seen what they did to the countryside and people to build the Three Gorges dam? I am surprised that anyone, especially you, would consider China to be a country we should be taking our cues from. I remember in the 80s a proposal to build LNG terminals in NYC. A LNG tanker, if it exploded, would level NYC."

1. Any nation hell-bent on industrializing and modernizing goes through a phase where pollution is an accepted evil to better the masses. Look to your history about soot-encrusted 19th Century London, Liverpool, Pittsburgh, NYC.

2. Any nation willing to develop hydro resources (a renewable, alternate power!) accept that lots of people will be displaced. Look at the Tennessee Valley Authority. China has more people, ergo, more displaced. China is operating on the same principle that created LA and screwed the farmers and settlers of Oro Valley - needs of the many outweigh the needs of a few.

3. The very reason why Rising China is going with LNG and 30 or so nuclear plants is to clean up the air, now that they have the prosperity and sophistication to move past their raw, brute force industrial phase...17 of the 25 worst air pollution cities are in China. China sees the hydro, LNG, and Nuke power as their cleanup salvation, (along with limiting population growth)..

4. An LNG ship would level NYC? More ignorant enviroweenie BS put out to scare people. Like feminism, the environmental movement is notorious for putting out false info to help recruit and ideologically herd it's new followers. I think the Coasties have set a 500 yard min safe zone around a LNG ship discharging at a terminal, and the min safe distances for LNG tanks onshore is 1 mile in case they catch fire. They doen't explode. They burn. The Nat Gas needs air, it mixes, burns, heats, and most of the enegy release is straight up. (Would be a hell of a fire, and a hell of a show, though...)

********************

Chris M - "Chris Ford is an oil industry tool.
The truth is that alternative energy sources are the future, and oil is the past.
Effective alternatives to oil exist right now, but the current administration owes too much to the oil companies to enact any meaningful changes to its oil-centric policy."

I don't work in the oil biz. I energy consult.

If effective alternatives to oil exist right now, but are blocked by the eeeeevviiiiiil Bushies and Big Eeeevviiiil American Oil Companies.....then why haven't the Progressive, Oh so Morally Superior governments of Europe gone with all those alternatives to oil that you claim exist right now? I mean, governments with Greens in Coalition and the rest in power somewhere to the Left of liberal American Democrats??? The answer of course is that there are no economically viable alternatives to oil. And despite Greenie squawking, and all their efforts to make Chernobyl into a 2nd Holocaust by PR, Europe has not rejected nukes but are now going back to them - especially after the Russians rudely squeezed their balls for relying too much on Russian honesty and competence in bringing forth gas and oil supply.

Posted by: Chris Ford | April 26, 2006 03:03 PM

plantation wrote:
"Think of rationing as a consumption cap on this one source of energy, and one that does not knock out the little guy. With a cap future shortages are delayed. With a cap alternative sources are brought to life."

Its silly if there is no shortage and you impose "consumption caps" that cause people and businesses to restrict their driving and deliveries. Companies will have to pass along their higher costs to consumers causing economic hardships. That IS silly. Now if you want to consider this WHEN there is an alternative source of fuel to encourage moving to that fuel, that is different. I am not for ruining the economy to conserve the oil in other countries. If anything we should charge the oil industry with a windfall profits tax and redistribute that money as grants for research and development into alternative fuels. But the republicans have decided that any windfall profit tax is off limits for the oil companies.

As a side note, I thought it was mildly amusing when I read Bush's speech about supporting R&D into biofuels. He spoke of 10s of millions of dollars here and there. That is nothing. It reminded me of Dr. Evil, after being frozen for decades, demanding "one million dollars" or he would do his evil plan. It will take many hundreds of millions and likely billions to get biofuels off the ground and into filling stations within 20 years. Bush just does not see any urgency or the amounts the government is putting into biofuels would be much higher. If people knew a 10 cent tax hike on gas was going to be used to bring biofuels to market, I expect a majority would approve, but it goes against the grain of republicans for government to use taxes for anything good.

Posted by: Sully | April 26, 2006 03:08 PM

Chris wrote:
"The answer of course is that there are no economically viable alternatives to oil."

How do you explain what the Brazilians are doing with ethanol?

Posted by: Sully | April 26, 2006 03:16 PM

Every posting from Chris Ford is like a ripping fart that disturbs the nostrils.

Just an observation.

Posted by: Emilio | April 26, 2006 04:01 PM

Reverend Solomon's postings, on the other hand, can be likened to a ripple of birdsong that delights the ears.

I get it, Reverend, furthermore, I can't agree more. The exorbitance of the gas prices, however, is a particularly sensitive matter for the American consumer. A special case, if you will, that spawned this discussion.

Peace to you as well.

ps. religion is opium for the people.

Posted by: | April 26, 2006 04:11 PM

Sully wrote:

"Its silly if there is no shortage and you impose "consumption caps" that cause people and businesses to restrict their driving and deliveries."

"If anything we should charge the oil industry with a windfall profits tax and redistribute that money . . ."
_____________

Consumption caps with rationing/allocations are already well ingrained in our market system. And for much the same purpose -- that is, when the free market has not worked to meet policy objectives. Ever heard of secondary-market trading in pollution credits for electrical power producers? Interesting side note, Iran has gas rationing on consumers (and 40 cent gas).

The rewards of conservation need to go directly to the conservers of fuel, not subsidize the extravagancy of monster vehicle operators. Equitable individual-consumer rationing accomplishes that. Some scheme to punish oil companies through through some accounting complexity that "redistributes" profits, not knowing what to whom -- that's the silly idea.

My proposal was directed at individual consumers. How business incentives and caps might operate would be a separate issue (ever heard of the War Production Office employing Richard Nixon?). But, of course, if businesses cannot compete by absorbing the actual costs of energy, then, in the approximate words of Hillary, "government can't save every undercapitalized business."

I detect a tone in your comment that suggests "to conserve the oil in other countries" would somehow cut into an American entitlement. Curious attitude. If we're saving them, then we have some claim. Otherwise, the honest plan is to work out our own solution (which, BTW, has real limits on the economical use of ethanol, well below our present levels of liquid fuel usage).

Posted by: On the plantation | April 26, 2006 04:20 PM

Either ignore Chris Ford or taunt him relentlessly. There really is no other purpose to him here at 'The Debate' other than that. No matter what the issue is, he tries to twist it into putting forth his wacky and way-out ultra-right wing nonsense. A lot of Americans are suffering because of gas prices going so high, yet all Chris Ford wants to do with the issue is attack the environmentalists with it. If we listened to the environmentalist instead of big business in the USA, we'd be in a better place right now as far as gas prices. We're kept overly dependent on oil deliberately so that the oil companies can keep profitting; They have a lot of money, and money is what our government responds too. Only a sucker like Chris Ford would try to deny that.

Posted by: ErrinF | April 26, 2006 05:45 PM

"The answer of course is that there are no economically viable alternatives to oil."
How do you explain what the Brazilians are doing with ethanol?
Posted by: Sully"

Brazil is cutting down 100 square miles of Amazonian rain forest a year to expand it's cane ethanol acreage. It has a double crop climate and cane is more suitable for large scale alcohol production than corn. All to get ethanol that costs them about 4.50 a gallon gas equivalent. In previous discussions, other posters clearly showed and linked to studies that illustrated ethanol is a non-flyer because of cost, limited US acreage available, alternate land use costs.

******************

"Either ignore Chris Ford or taunt him relentlessly."

That is Marxist ErrinF's answer for any debate where her side is seen as pathetic and 1970's retro. Employ the tactics she was taught under Herbert Marcuse's "Repressive Tolerance" and attempt to shutdown counter-Marxist voices that only add to repression of the proleteriate if heard. Use the politics of confrontation and shout-downs to silence opponents.

Hate to tell you, ErrinF, but that tactic is old outside the Angry Arab Street. Even the Euroweenies have grown sick of the Gays shouting down the Vegans who were shouting down the Democrat Socialists who were shouting down the Greenies because the Vegans don't support more money for AIDs cures.

Isn't it time you matured past Marcuse and the 1970s??

Posted by: Chris Ford | April 26, 2006 06:38 PM

You people must be pretty stupid if you think gas prices won't go up if you don't drill in Alaska. I guess everybody wants to have to pay $3:00 gas prices for the summer, don't they? I certainly don't want to have to pay 54 stinking dollars for 18 gallons of gas. You can go ahead and worry about you dumb wildlife reserves, you probably could care less about how much your gas costs, cause you got your precious hybrids that use gas anyway! So let this be a message for you tree huggers. Let's all let the animals survive in that frozen wasteland where no human lives anyway. Not to mention that the same animals live in the Tundra, but that doesn't matter now, does it?

Posted by: Anonymous | April 27, 2006 01:14 PM

Anonymous wrote:
"You people must be pretty stupid if you think gas prices won't go up if you don't drill in Alaska."

You sound like you're pretty smart! Please tell how much will gas prices come down if we do drill?

Also, how much will the prices come down if Bush is impeached, we withdraw our troops from Iraq over the next year and work quietly against Iran's nuclear ambitions instead of Bush shaking nuclear missles in the air? This may give you some idea of why prices are high and the amount of oil has nothing to do with it:
http://zfacts.com/p/35.html

Posted by: Sully | April 27, 2006 02:00 PM

There are several fundamental problems which figure into the current "crisis".

1. Oil industry analysts have known for several years that rising demand in the Far East coupled with the US insistence on gas-guzzling super cars (Hummers, anyone?)would contribute to higher prices starting in 2004. Rather than undertake any real action to encourage development of long-term solutions like alternative fuels, the GOP has been empowered by it's funding base, the oil industry, to hand out tax breaks and weaken environmental protections so that profits would increase dramatically, along with campaign contributions. Drilling up everything in sight has so far produced enough oil to serve our needs for less that 250 days; it has also added to the strain on an already-stressed environment, while doing nothing to curb our thirst for gasoline. Until voters insist at the polls, politicians whose livelihood is financed by special interests like the oil industry will continue to lead us down the path of energy starvation and economic ruin. It really makes no difference which side of the aisle you endorse; what DOES make a difference is what action your representative takes, and whether or not it reflects YOUR needs. The current posturing by Congress to provide relief is a pathetic example of a government run amok, lead by a President dangerously out-of-touch with the American citizens. It's time to start voting ISSUES, not parties, folks! As for the price of gas, nothing your Congress is proposing today will make a bit of difference in 6 months, except, of course to their REAL constituents, the oil lobby. Get used to it folks; King George has 2 years left on the throne!

Posted by: Doug7504 | April 28, 2006 10:23 AM

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